County fair season has wrapped up for another year, and harvest has begun in earnest for corn and soybeans around the state. Crop yields, moisture levels, and test weights are dominating conversations. It is very apparent that the weather pattern this summer really affected crops in a negative way. We are seeing that now, particularly with corn crop yields.

Once harvest completes, the next challenge facing farmers is marketing their commodity. Once again this fall, the Farm Service Agency offers the Marketing Assistance Loan option.

Marketing Assistance Loans (or MALs) allow producers to receive upfront income from their harvested crops without making any commitments on how they will market the crop. The MAL uses your stored crop as collateral to issue a low interest loan for up to nine months.

Easy to understand

Rules are fairly simple to participate in this program. Each county has a set of loan rates for each eligible crop. Once it is determined how many bushels the farmer has in storage, this number is multiplied by the county loan rate for that specific crop to determine your maximum loan amount.

After the loan is disbursed, participants have until loan maturity to repay the proceeds. If any grain is marketed or fed during the term of the loan, these bushels must be accounted for and repaid prior to grain removal.

In some cases when a loan release is filed, the repayment can come directly from the elevator handling your grain.

Interest rates associated with the MAL are based upon the month of disbursement. For example, loans approved here in October will carry an interest rate of 1.125 percent. This rate is essentially fixed, with only one adjustment made in January.

MAL participants are required to maintain both the quality and quantity of grain under loan.

On- or off-farm

Marketing Assistance Loans are available on both farm stored grain and warehouse stored commodities as well.

Warehouse stored commodities remain eligible as long as the applicant retains beneficial interest in the crop. Beneficial interest is lost once grain is put under DP (delayed price) provisions. If you have questions on the eligibility of your commodity, contact FSA prior to delivery.

Producers feeding their grain are also eligible for this program. It is suggested that applicants who plan to feed their commodity to on-farm livestock set up a repayment schedule to ensure bushels are repaid in a timely manner.

Contact your local FSA office for more information on this program and to obtain your local loan rates.